24 April 2019

2019- n° 102

In April 2019, the business climate weakens slightly in the building construction industry but remain at a high level Monthly survey of building - April 2019

According to the business managers in the building construction industry surveyed in April 2019, the business climate has weakened slightly. After a virtual stability in March, the composite indicator has dipped by one point and stands at 111, still largely above its long-term average (100).

In April 2019, as many business managers as in the previous month have indicated an increase in their activity over the last three months. The corresponding balance is stable above its long-term average after having increased progressively since the end of 2018. Business managers are a little less optimistic about their activity prospects: the balance of opinion on expected activity has slightly decreased while remaining well above its long-term average. However, business managers remain as upbeat as in the previous quarter on the general outlook of the sector. The corresponding balance is virtually stable after four consecutive quarters of decrease and remains well above its long-term average.

In April 2019, fewer business managers than in March have reported an increase in their staff size over the last three months. The corresponding balance has decreased again while remaining above its long-term average. However, employment prospects have improved: after a sharp decrease in March, the balance of opinion on expected staff size has picked up and stands well above its long-term average.

In April 2019, as many business managers as in the previous month consider that their order books are well filled. The corresponding balance of opinion is stable at its highest level since May 2008, far above its long-term average. With their present staff size, business managers consider that their order books provide 8.0 months of work, the same volume as last month and much greater than the long-term average (5.6 months).

The turning point indicator remains in the area indicating a favourable economic situation.

In April 2019, the production capacity utilisation rate is virtually stable, as in the previous month. At 91.5%, it stands above its long-term average (88.5%), as for a year and a half. At the same time, 45% of business managers have reported production bottlenecks, against one out of three on long-term average. This share has increased slightly compared to the previous month and has reached its highest level since September 2008. Moreover, 25% of business managers have declared production bottlenecks due to workforce shortage, the highest share since September 2008 and well above the long-term average (14%). Moreover, nearly three business managers out of three have encountered recruiting problems; this share has risen slightly after having slipped back in January for the first time since July 2015. It remains much higher than the long-term average (58%).

In April 2019, many more business managers than in January 2019 have indicated an improvement in their cash-flow position. The corresponding balance has surged and has exceeded its long-term average. At the same time, fewer business managers have reported that their customers’ repayment period has been lengthened. The corresponding balance has slipped back after a sharp increase in the previous quarter. It remains however above its long-term average.

In April 2019, as many business managers as in March have announced that they will increase their prices over the next three months. The corresponding balance is stable well above its long-term average.